On a conference call, Chuck Schumer urged House Speaker John Boehner to renounce the threat to allow a default of the United States’ financial obligations by blocking an increase in the debt ceiling. This threat, even if it’s contrasted with an implicit guarantee to raise the debt limit eventually, could be enough to send the nation’s financial markets into a tailspin. Schumer said that Boehner “must provide unwaivering reassurance to the credit markets.”

Schumer also set a new deadline of July 15 as a drop-dead date to raise the debt limit. The Treasury Department decided on August 2 as the point at which they could no longer manage finances to prevent the debt limit from being reached. But Schumer said that markets would react negatively without an assurance by mid-July. Schumer brought on Roger Altman, former Clinton Treasury Department official and Evercore Partners chairman, to make that case further.

This comes right before Boehner heads to New York to discuss the debt limit issue on Wall Street.

In a speech to the Economic Club of New York in Midtown Manhattan, the Ohio Republican is set to reiterate to leading financial executives that he believes that reforming Medicare should be part of negotiations in raising the debt ceiling, saying that there needs to be “an honest conversation,” because the program is on an “unsustainable path if changes are not made,” according to sources familiar with the speech. Boehner also is expected to advocate for immediate cuts rather than deficit and debt targets preferred by some Democrats.

After his talk, Boehner will take questions from two prominent Wall Street players at the intersection of Washington power: Peter G. Peterson, the private-equity giant who worked for President Richard Nixon, and Observatory Group CEO Jane Hartley, who worked for President Jimmy Carter [...]

Boehner’s public insistence that reforming Medicare stay a part of debt ceiling negotiations could reaffirm a concern among Wall Street types that Republicans are driving a hard bargain on the limit and will take the negotiations up to the last minute. Boehner said last week Congress must now cut trillions, not billions.

As I made clear on Sunday, the Medicare thing is a pose, and not a very convincing one. But clearly Boehner is treating this like a negotiation, and there are potential consequences for that.

The problem is that the Democratic counter-argument to this demand for trillions in cuts from Republicans is to institution this debt trigger, Harry Reid’s idea, which would mandate spending cuts or tax increases if the debt reaches a certain level. Schumer reiterated this as a possibility on the call, while dismissing a pure spending cap that would not allow for tax increases. But all of these global caps are bad ideas, particularly during a demand shortfall. My guess is they would be designed in such a way that the trigger wouldn’t actually be reached, but it’s still a dangerous game. And as a policy prescription it represents a failure to come to terms with what the economy actually needs.

How will our left of Hillary President convince us that he sadly had to agree to another GOP goal this time.

The act is getting old – but he wants 4 more years of pretend – and as some on the left say – look at the alternative.

You know the Tea Party will agree that the Obama version of the GOP goal is socialism, and Obama will, again will sincerity and great speeches, sadly tell us he must now move still further to the right.

Cut the debt by cutting the troops in Afghanistan to 20,000 from 130,000, then kill the toys for boys Pentagon budget by returning it to Clinton levels, then look at the Clinton Intel spending that was $26 billion and is now $86 billion – perhaps that can be cut – just maybe? Then hit the tax code on tax rules that send jobs overseas, and kill the tax welfare for corn and other food and for big oil. Then do the Clinton tax rates and spend the money on a single payer health plan with a prospective annual budget (see Vermont idea), and on projects that are exclusively jobs in America.

Good grief – today China complained about how they are not getting enough US gov contracts and thus not employing enough of their citizens with our tax dollars. Get that 25% tariff passed – and forget about a debt/deficit trigger.

Is the ObamaRahma administration negotiating with Wall Street in public through Chuck “the banker” Schumer…or is this another attempt to set up a last minute emmergency cave-in like the disasterous healthcare failure? It seems to me that even Obama isn’t stupid enough to play the same con twice on the same folks in public.

Now that the administration has its new campaign photo of a strong new “Obama the Assasin” ready for distribution, why are they timid about gettin out in front of what Wall Street has already decided to support? I’m not breathin’ the atmospherics right I guess…please give me a little CPR on this issue Brother Dayen.

KEEP THE FAITH AND PASS THE AMMUNITION, THERE ARE MORE OF US THAN THERE ARE OF THEM!!!

By my read, we are way past pretend and things are already “fascinating” and it’s not even the end of QE2 scheduled for June. I saw “China Just Gave Us Another Sign Of Global Economic Slowdown (May 1, 2011) but am curious as to where you read about ChinaG complaining about not having enough USG welfare.

What’s entirely missing here is any real effort to manage, to govern the country.

This is like having two football teams out on the field shoving each other back and forth, throwing the ball, going for advantage, going for touchdowns — while asking them to consider the needs of the nation and future generations.

Their reply will be, “Not now, we need to get down the field!” All that matters to Congress and the two Parties in DC is getting power and using it to get more. And it is all done with corporate money.